:: Commercial Real Estate Education and Investing::

As a real estate agent, you will either be prospecting or working. Prospecting is simply looking for work to do. Working includes consulting, letting, selling and managing real estate. If you do not go out there to look for work, you will not have any work to do. If you do have, then someone else has brought it to you.

Capital gains or rent income? Commercial real estate rewards investors through periodic rent income and capital gains over time. Rent is realised every time your tenant writes to you a cheque. Capital gains on the other hand is realised when you dispose of your property locking in the gradual increment in the value of your property.Read more »

Marketing real estate is a very expensive undertaking. Often times, property owners settle for less just to keep their budgets in control. In extreme situations, they withdraw their property from the market altogether. Here is what could be missing in your marketing campaign.

Return on investment is a measure of profitability of the investment. Return on investment is also a measure of the risk in the investment. Real estate is a low risk investment with modest return on investment. Higher returns are associated with riskier investments as investors tend to demand higher returns for assuming higher risk. Investment risks include risk of total or partial loss of the capital or income. Investors therefore prefer shorter periods of risk and seek higher returns. The higher the return on investment therefore, the higher the risk assumed.Read more »

High interest rates in Kenya is hurting real estate investment. Interest is a cost to the developer of real estate as it is to the end buyer. Since October 2011 the Central Bank of Kenya (CBK) has increase the Central Bank Rate (CBR) from 7% to 18% in an effort to tame runaway inflation and stabilise the weakening shilling. Consequently commercial banks have increased their lending rates from low figures of 11% to about 25%.

Double property titles is one of the major risks associated with real estate. Double property titles occur when the registrar or any other authority issues one or more titles for the same real estate. Where the registrar or such authority inadvertently issue two or more titles bearing the same land reference number for separate parcels of land, the danger may not be great. Read more »

A building that is built on sand will sink, develop cracks and eventually collapse. A building on solid rock cannot withstand the might of bulldozers. So how strong is your investment? The real foundation upon which to build your real estate (read as land and building) empire is your property title. It is the title that will grant you the right to develop, keep or dispose of real estate.

Real estate is neither a profession nor a trade. No credentials are pre-requisite before venturing into real estate. Indeed many of us take it as a second profession, where we invest our hard earned monies, or where we commit our incomes from our primary profession. However, how many of us ever spend time to learn how real estate works?

If you own real estate, you are a CEO and your success will be measured by how profitable you make your business. Your duty as CEO will be to maximise the returns to the shareholders – you. You will have to evaluate the strengths, weaknesses, opportunities and threats to your business – SWOT analysis and act accordingly.

Your customer(s) (tenants) will be your greatest asset and so you will need to make the property attractive to them. Read more »

Investment value of real estate is a term that is confusing to both the professional valuer and the investor, and the reason is simple: the valuer is not the investor and vice versa. The valuer may not agree with your investment objectives, but that does not make you a poor investor, as you could be earning lots of money or saving lots of it from your real estate.

Unlike the market value, where forces of demand and supply are in play, the investment value is specific to you. Investment value according to you may therefore substantially differ from investment value according to the valuer or the valuer’s appointing institution.